Where Does Your Fuel Money Go? A Breakdown of Petrol Prices in Australia
A cent-by-cent breakdown of what makes up the price of a litre of petrol in Australia — from crude oil to the pump. With verified math using ACCC data.
When petrol hits $2.20 a litre, it's natural to wonder: where is all that money going? Is it the oil companies? The government? Some trader in Singapore?
The answer is all three — but in proportions that might surprise you. Here's a cent-by-cent breakdown using the ACCC's most recent published data, with the math verified independently.
Where does each dollar go?
Every litre of petrol you buy is made up of three main cost layers. Here's how the ACCC broke down the national average price of 180.4 c/L in the December quarter 2025 (the most recent complete quarterly report):
| Component | Cents per litre | Share |
|---|---|---|
| International refined petrol price | 76.1 | 42% |
| Tax (excise + GST) | 68.0 | 38% |
| All other costs and margins | 36.3 | 20% |
| Total pump price | 180.4 | 100% |
In plain terms: about 42 cents in every dollar goes to buying the actual fuel on international markets. About 38 cents goes to the government. The remaining 20 cents covers getting it to Australia, storing it, running the servo, and everyone's profit margins along the way.
Let's unpack each one.
The international price of refined petrol (42%)
Australia doesn't set its own fuel price. We import roughly 90% of our refined fuel, and even the fuel made at our two remaining refineries (Ampol Lytton in Brisbane and Viva Geelong in Victoria) is priced at what it would cost to import it. This is called import parity pricing.
The benchmark is called Singapore Mogas 95 — the price of 95 RON refined petrol traded in Singapore, the Asia-Pacific's largest refining hub. It's assessed daily by S&P Global Platts and published as a US dollar price per barrel.
This benchmark captures two costs in one:
- The price of crude oil — Brent crude averaged about US$64 per barrel in late 2025
- The cost of refining it — turning crude oil into usable petrol. The refining margin (called the "crack spread") was about US$15 per barrel in late 2025
Together, these set the Mogas 95 price at about US$79 per barrel. Converting to Australian cents per litre (using the AUD/USD exchange rate at the time), that's the 76.1 c/L the ACCC reported.
Why the exchange rate matters: Fuel is priced in US dollars but you pay in Australian dollars. When the Aussie dollar drops against the US dollar, fuel gets more expensive even if oil prices haven't moved. In the December quarter 2025, the AUD was worth about US$0.656. If it had been at the more favourable US$0.75 (where it sat a few years earlier), that 76.1 c/L would have been closer to 66 c/L — a 10 c/L difference from the exchange rate alone.
Tax — excise and GST (38%)
This is the government's cut, and it comes in two parts.
Fuel excise: 52.6 c/L
Fuel excise is a flat charge per litre — currently 52.6 cents (as of 2 February 2026). It doesn't change with the price of oil. Whether petrol costs $1.50 or $2.50, you pay the same 52.6 cents in excise on every litre.
The rate is indexed to CPI twice a year (February and August), going up a cent or so each time. It was frozen at 38.1 c/L for 13 years (2001–2014) before indexation was reintroduced. In 2022, the Morrison Government temporarily halved it to 22.1 c/L for six months during the Ukraine crisis — the only time that's ever happened.
Despite what many people assume, fuel excise does not go directly to roads. It flows into the government's general revenue. The formal link between excise and road funding was abolished in 1992. The Australian Automobile Association estimates that only about 57% of excise revenue was reinvested in land transport over the decade to 2022–23.
GST: 16.4 c/L (at 180.4 c/L pump price)
GST at 10% is charged on the total price including excise — yes, it's a tax on a tax. At 180.4 c/L, the GST component is 180.4 / 11 = 16.4 c/L. When the pump price rises to $2.20, GST rises to 20.0 c/L.
Total tax
At 180.4 c/L: 68.0 c/L in tax (37.7% of the pump price).
On a 50-litre fill at $1.80/L, that's $34.00 going to the government.
The other 20%: wholesale and retail costs
That 36.3 c/L of "other costs and margins" covers two distinct stages — getting the fuel to Australia (wholesale) and selling it to you (retail).
Wholesale costs (~20 c/L)
Between the fuel arriving at Singapore's price and reaching the terminal gate in Australia, several costs accumulate:
- Shipping from Singapore refineries to Australian ports
- Insurance and loss during transport
- Wharfage — the port charges for docking and unloading the fuel tanker
- Quality premium — Australian fuel standards now require ultra-low sulfur content, which costs slightly more to produce
- Terminal operating costs — storage tanks, pipelines, pumping
- Wholesale marketing and margin — the fuel company's wholesale profit
All of this added up to about 20.0 c/L in the December quarter 2025.
The wholesale price at the terminal gate is called the Terminal Gate Price (TGP). It's published daily by the Australian Institute of Petroleum and is regulated by the ACCC under the Oilcode. It's the price a retailer pays to pick up fuel at the depot, before trucking it to a service station.
Retail costs and margins (~16 c/L)
The final slice is what the service station adds. The ACCC calls this the Gross Indicative Retail Difference (GIRD) — the gap between the wholesale terminal gate price and the pump price.
In the December quarter 2025, the national average GIRD was 17.9 c/L. This covers:
- Station rent or mortgage
- Staff wages
- Electricity (pumps, lighting, refrigeration)
- Equipment maintenance
- Insurance
- The retailer's profit
That 17.9 c/L is the gross margin — not profit. After operating costs, the actual profit per litre for an independent servo can be just a few cents.
Margins vary wildly by city
The ACCC publishes GIRD by capital city, and the differences are striking:
| City | Retail margin (c/L) |
|---|---|
| Brisbane | 24.7 |
| Melbourne | 22.0 |
| Sydney | 20.5 |
| Perth | 11.3 |
| Adelaide | 10.8 |
Brisbane's retail margin was more than double Adelaide's in the same quarter. This partly reflects different competitive dynamics — Adelaide and Perth have more aggressive discounting patterns with shorter, sharper price cycles.
What happens when prices spike?
Here's where it gets interesting. When prices jump — like the March 2026 crisis — the tax share actually shrinks as a percentage, even though the absolute amount rises.
Let's compare the ACCC's December quarter average (180.4 c/L) with the five-city average on 11 March 2026 (219.7 c/L, published by the ACCC):
| Dec Q 2025 | 11 March 2026 | Change | |
|---|---|---|---|
| Pump price | 180.4 c/L | 219.7 c/L | +39.3 |
| Excise | 51.6 c/L | 52.6 c/L | +1.0 |
| GST | 16.4 c/L | 20.0 c/L | +3.6 |
| Total tax | 68.0 c/L (37.7%) | 72.6 c/L (33.0%) | +4.6 |
| Everything else | 112.4 c/L | 147.1 c/L | +34.7 |
The price rose 39.3 c/L. Of that, only 4.6 cents was extra tax (3.6 c/L more GST, plus a 1.0 c/L excise indexation increase from February). The other 34.7 cents went to international costs — higher crude oil, wider refining margins, and increased shipping costs driven by the Strait of Hormuz disruption.
On a 50-litre fill, you're paying $19.65 more than three months ago. Of that, only $2.30 is extra tax. The remaining $17.35 reflects the global oil price surge.
This is why excise is a flat rate, not a percentage — it acts as a partial buffer during price spikes. The government collects roughly the same excise per litre regardless of whether oil is US$60 or US$120.
The rule of thumb
A commonly cited rule is that every US$10 rise in crude oil adds about 10 Australian cents per litre at the pump.
Here's the math behind it:
- One barrel of oil = 158.987 litres
- US$10 / 158.987 = US 6.3 cents per litre
- Convert to AUD (at roughly 1 AUD = 0.71 USD): 8.9 Australian cents per litre
- Add GST (10%): 9.8 cents per litre
Close enough to 10 cents. The exact figure depends on the exchange rate — when the Aussie dollar is weaker, each US$10 move hits harder.
The chain from oil well to bowser
Here's the complete journey, step by step:
- Crude oil is extracted (Middle East, North Sea, US, etc.) and priced globally — Brent crude is the main benchmark
- Refineries in Singapore, South Korea, and Japan convert crude into refined products. The price of refined petrol is the Singapore Mogas 95 benchmark
- Tankers ship the refined fuel to Australian ports (1–2 weeks transit)
- Fuel terminals at port receive, store, and distribute the fuel. The price at this point is the Terminal Gate Price, published daily
- Fuel trucks deliver from terminal to service station
- You fill up at the pump price, which includes the retailer's margin on top
The whole chain from a change in crude oil price to a change at your local servo takes roughly 1–2 weeks in capital cities, sometimes longer in regional areas.
Frequently asked questions
How much tax do I pay on a tank of fuel? At current prices around $2.20/L, about 33 cents in every dollar goes to tax (excise + GST). On a 50-litre fill costing $110, that's roughly $36 in tax — $26.30 in excise and $10.00 in GST.
Why doesn't the government just cut fuel excise? It did once — halving it from March to September 2022 during the Ukraine-driven price spike. It cost the budget roughly $3 billion in foregone revenue over six months. The current government has declined to cut excise during the 2026 crisis.
Do servos make huge profits when prices spike? Not necessarily. The ACCC's annual average retail margin was 16.3 c/L in 2025 — only 0.2 c/L above the inflation-adjusted 10-year average. Retail margins are a gross figure that includes operating costs. The actual profit per litre for an independent station can be just 2–5 cents. Most servo revenue comes from the shop inside, not the fuel.
Why does Australian fuel cost more than the US? Mostly tax. US federal and state gas taxes combined average about 57 US cents per gallon — roughly 21 Australian cents per litre. Australia's excise alone is 52.6 c/L, plus GST on top. That's a tax gap of roughly 50 c/L. Strip that out and the pre-tax fuel cost is comparable — both countries ultimately price off global benchmarks.
Is fuel more expensive in regional areas? Slightly. The ACCC found regional prices averaged 180.6 c/L in late 2025, compared to 180.4 c/L in capital cities — a gap of just 0.2 c/L nationally. But this average masks wide local variation. Remote areas can be 20–40 c/L above capital city prices due to higher transport costs and less competition.
What's the single biggest thing I can control? The retail margin. It varies hugely between stations in the same suburb — the ACCC data shows Brisbane's average margin was 24.7 c/L, but individual stations range from near-zero to 30+ c/L depending on where they are in the price cycle. Finding the cheapest station near you can easily save 15–25 c/L.